Treasurer Joe Hockey says every aspect of the tax system is up for review in the wake of a Federal Government discussion paper which suggests Australia relies too heavily on corporate and income taxes and not enough on consumption taxes like the GST.

In highlighting the complexity of the current GST system, the 200-page paper used an example of how pizzas, pizza subs, pizza pockets and bakery-style pizza rolls were defined by law and taxed differently.

The Re:Think paper found the Federal Government collected about 70 per cent of its revenue from company tax and personal income tax.

That, the document warns, will discourage hard work and investment, creating the potential to harm Australia's economic growth in years to come.

The document also questions the rationale for tax breaks like negative gearing and super contributions.

The complexity of pizza and the GST

Under the GST law, food is generally GST-free unless it is a type of food specifically listed as being subject to GST.

This appears to be reasonably straightforward but is not. Pizzas, pizza subs, pizza pockets and similar foods are subject to GST.

In contrast, pizza rolls are generally GST-free but can be subject to GST when they are similar to "pizzas, pizza subs or pizza pockets".

Defining whether something is a pizza or a similar food has proved complex in the context of various baked goods.

The ATO has advised that determining whether a pizza roll is taxable requires consideration of the depth of any filling or topping, the recipe for the dough and whether the roll can be cut, have additional filling added or is expected to be served as is.

This analysis is complex and undertaking it places a considerable burden on businesses.

The rationale for having different tax treatments apply to pizza rolls with thicker topping is not clear.

"If you're having a fair dinkum conversation with the Australian people, everyone should be fully informed about what the pressures are on the tax system," he said.

"Everyone should be fully informed about the success or otherwise of individual taxes."

The Treasurer also highlighted the issues surrounding how to apply the GST to online purchases.

Shadow Treasurer Chris Bowen said Labor did not support changes to the GST, but wanted to take a constructive approach to the tax reform debate.

"We'll be participating not only constructively but very proactively in the tax reform debate. We have indicated that we will be continuing our consultations and we'll be leading," Mr Bowen told Radio National Breakfast.

Business groups urged both sides of politics to contemplate broadening the GST following the Treasurer's release of the discussion paper.

Kate Carnell from the Chamber of Commerce and Industry said changes to the GST must be discussed.

"The figures are pretty clear here," Ms Carnell said.

"The GST has to be in the mix if we are to afford the things that Australians want to pay for, that's our ageing community, the increased cost of health, the National Disability Insurance scheme, just to name a few."